Lee + Kinder is very happy to report that we are expanding for the third time in five years.  Our additional space will allow us to more comfortably accommodate our expanding number of well-qualified legal counsel, in addition to our wonderful support staff, necessary to ensure that we uphold our commitment to the highest quality legal representation.  We are driven by the understanding that the client directs the case – we simply ensure that the course is confined within the parameters set forth by Colorado law in the most expeditious and cost-effective manner possible.

The Victory Lap

Congratulations
to L+K Associate N. Elizabeth Quick for successfully showing inOliver v. Home Depot and American Insurance Group that Claimant was not entitled to TTD benefits in her claim for workers’ compensation due to her termination for cause. While the Court found Claimant sustained a compensable injury, Ms. Quick offered credible evidence and testimony that Claimant was terminated for cause and was therefore not entitled to TTD benefits from her employer, Home Depot. Tabitha v. Home Depot USA, Inc. v. American Insurance Group, W.C. 4-896-019 (March 12, 2013).

Congratulations
to Of Counsel Joseph W. Gren who successfully defended a surgeon’s request for a triple level fusion. The claim was an admitted injury and three surgeons’ opined that the triple level fusion was reasonably necessary. After discovering the existence of prior cervical treatment that Claimant did not disclose to the adjuster, the three surgical opinions were challenged on the grounds that the need for surgery was not related. The ALJ found claimant’s cervical injury and treatment was unrelated to his industrial injury. Salinas-Ofsowitz v. United Parcel Service and Liberty Mutual, W.C. 4-887-631 (March 27, 2013).

Additionally, Mr. Gren, in a recent Order from ALJ Friend, successfully struck Claimant’s Application for Hearing in Arthur Stewart v. United Parcel Service and Liberty Mutual (March 22, 2013).  Mr. Gren was successful in his argument and overcame a challenge by Claimant to the language of the Final Admission of Liability filed by Respondents.  Claimant requested a general award of maintenance benefits without reference to a medical report.  ALJ Friend determined that Respondents properly admitted on the claim taking a position on maintenance benefits.  Respondents’ position was based on a specific medical report and stated that Respondents would cover all maintenance medical benefits rendered after MMI if reasonable, necessary and related to the compensable injury.  ALJ Friend also struck Claimant’s Application for Hearing on the grounds of ripeness, as no medical bill was disputed.

Cases You Should Know

These summaries are provided as a brief review, and are not intended to substitute for legal counsel. For legal advice, please contact our attorneys at leekinder.com.

Cases You Should Know

These summaries are provided as a brief review, and are not intended to substitute for legal counsel. For legal advice, please contact our attorneys at leekinder.com.

Closure of Claim:  An FAL is not void ab initio, or as if it never happened, when there are no impairment worksheets attached to the Final Admission and no evidence that such documents had been completed or were medically relevant.  Stolz v. IMB Corporation and Liberty Mutual, W.C. 4-845-221, (January 17, 2013).  Claimant had suffered an admitted injury to his left upper extremity and was placed at MMI.  He was not given an impairment rating or work restrictions.  The provider did not attach any worksheets to the FAL because none were ever completed. Claimant did not object to the FAL within the 30 days based on the fact that he felt it was not valid because no worksheets were attached. But, this did not preclude administrative closure of a claim where a Claimant fails to object to the FAL within the prescribed time.

Assessment of Penalties:   C.R.S. § 8-43-304(1) allows for penalties to be assessed for up to $1000 per day for any insurer who violates any provision of the Workers’ Compensation Act.  In order for an ALJ to provide penalties for violation of a particular statute, the Claimant must not only show that Respondents violated the provisions of the statute itself, but must also show that Respondents acted unreasonably.  Reves v. McCormick Excavation and Paving LLC and Pinnacol Assurance, W.C. 4-835-166, (January 2, 2013). This case further provides that “reasonableness” is a determination for the ALJ that must be based on a rational argument based in law or fact.

In another ICAO case, the court addressed the issue of determination of whether Respondents’ failure to pay medical reimbursements for a Claimant’s acupuncture treatments for a work-related injury, fell under the general or specific penalty statutes, C.R.S. § 8-43-304(1) for general violations or C.R.S. § 8-43-401(2)(a) for specific violation of delay in payment of medical benefits..  In Goss v. The Kroger Company, Self-Insured, W.C. 4-855-895, (January 14, 2013), the Court found that Respondents’ violations of W.C. Rule 16-11 did not exclude having penalties imposed under the general rule.  This case also highlighted W.C.R.P. 16 addressing Respondents’ duties to reimburse medical benefits.  Of note, although W.C.R.P. 16-6(A) applies to third party administrators and the Rule does not relieve the employer or insured from its obligation to comply with the utilization guidelines.

Denial of Medical benefits for delayed reporting of claim: Claimant alleged that Respondents denial of payment of medical benefits received prior to employer notification of a work-related injury was improper.   InCreagan v. Albertini Construction and Truck Insurance Exchange, W.C. 4-724-791, (December 21, 2012), the ALJ determined that Claimant could not receive compensation for medical benefits he received prior to reporting an injury.  The ALJ reasoned that an employer must have notice of the work-related injury unless a Claimant’s symptoms would cause a reasonably conscientious manager to realize the compensable nature.

Reopening per Worsening Condition: Claimant suffered an admitted injury to both of her feet, was placed at MMI, and given impairment ratings for each lower extremity. She later filed an objection to the FA and filed a proposal to select a DIME physician, but never pursued the DIME. The Director later entered an order to show cause but Claimant did not respond.  Claimant was permitted to reopen her claims for bilateral foot injuries based upon worsening condition where although a new physician found evidence of CRPS, which was cited as a contributory factor to the worsening condition, the ALJ’s order allowing reopening was based upon evidence of increased symptoms in Claimant’s feet.  Freisz v. Wal-Mart Stores, W.C. 4-823-944, (December 21, 2012).  Additionally, Claimant was permitted TTD benefits upon reopening despite her being on work restrictions at the time of MMI, because the worsened condition caused “greater impact” upon her ability to work than before.  Here, Claimant experienced increased pain, and the greater impact was a mere “difficulty” to do further work.

Influencing the DIME opinion: In Miller v. Centurylink, W.C. 4-843-356, (January 11, 2013), Respondents argued that the DIME’s opinion was not independent because it was influenced by the Division Medical Director’s opinion on impairment.  In sum, the DIME had spoken with the DOWC Medical Instructor who had told the DIME that a particular impairment rating was appropriate.  The ALJ found that, although the DIME’s opinion could have been influenced, there was substantial evidence, including pain complaints, which could have nonetheless support an impairment rating.

Compensability: A broken fibula suffered pursuant to a fall caused by leg numbness from sitting at a desk, where an employee’s work duties include typical desk work and require occasional walking, is a compensable injury.  Pettibone v. Qwest Corporation, W.C. 4-860-214, (January 10, 2013). The ALJ found that numbness was caused by the employment function of sitting at a desk.

While a certain activity could be a causative factor in the onset of an occupational disease, where a Claimant’s time spent doing this activity were far below the threshold levels required in the Medical Treatment Guidelines to be considered relevant and there is a significant history of pre-existing symptoms, the occupational disease is not compensable.  Holland v. Arkansas Valley Regional Medical Center, W.C. 4-879-232, (January 17, 2013).

Maintenance Benefits: Even where a surgical request has been denied twice by an ALJ at hearing because it would not improve a Claimant’s condition and the Claimant is thereafter placed at MMI, the surgery may nevertheless be authorized as proper maintenance care upon evidence that the condition is deteriorating and, therefore, necessary to maintain MMI status.  Sanders v. Adams County, W.C. 4-774-375, (December 31, 2012).  Moreover, reopening is appropriate if Claimant’s condition worsens pursuant to the operation.

Change of Authorized Physician:  Where an authorized provider refers a Claimant receiving maintenance care to his primary care provider for evaluation to decide if further treatment is necessary, and not for treatment itself, the evaluating provider is not considered authorized.  Zolman v. ICAO, (Colo. App. 2012)(not selected for publication).

Statute of Limitations for Claimant to file claim: C.R.S. § 8-43-103(2) requires Claimants to file claims within two years after the date of injury.  However, the statute does not begin to run until the Claimant recognizes that he has sustained a compensable injury. Hahn v. Town of Vail and Pinnacol Assurance, W.C. 4-886-148, (December 18, 2012).  The Court stated that for the statute to begin to run, the Claimant must discover not only the serious nature of the injury, but that he or she has sustained an injury sufficient in magnitude to allow a reasonable person to believe he or she is entitled to benefits.  Additionally, the statute runs from the time of the injury, and not the date of the initial incident or accident.

Substantial deviation from job duties:  A Claimant’s substantial deviation from his or her job duties, which is not comingled with any duty of employment, effectively removes the Claimant from the employment relationship and, therefore, there is no compensability. Orist v. G4S Secure Solutions, Inc. and New Hampshire Insurance Company, W.C. 4-886-126, (January 4, 2013). In this case, Claimant was a security guard at a hospital.  His job duties required him to have access to all areas of the buildings including in and around rooftop areas.  Claimant was jumping from an open window-like space onto a rooftop and then to another rooftop when he injured his left knee. Although Claimant’s job duties including accessing and exploring all interior and exterior portions of the property, his activities were found to constitute horseplay. A Claimant’s engagement in horseplay, as previously defined by a four-part test in case law, was enough to demonstrate a substantial deviation whereby compensability was denied.

Reviewable decisions: C.R.S. § 8-43-301(2) provides that any party dissatisfied  with an order that either requires a party to pay penalty or benefits or denies a Claimant any benefit or penalty, may file a Petition to Review.  These decisions are, therefore, not final and subject to review.  Any order that does not meet these statutory requirements is interlocutory, or not subject to immediate review. The Court recently held that requiring a Claimant to undergo a functional capacity evaluation (FCE) does not deny a Claimant the right to any benefits or payments, nor does it require Respondents pay either a benefit or penalty and, therefore, it does not fall within the statutory provision.

Joshua D. Brown, has been practicing in Colorado since 2005 and has successfully defended employers in suits involving the Americans with Disabilities Act (ADA), “Title VII” employment discrimination, age discrimination, and other matters routinely encountered by businesses large and small alike.

Josh also specializes in employment contract matters and related concerns, non-compete agreements, and trade secret issues, with a focus on avoiding undue litigation.

Federal, state, and administrative proceedings are familiar jurisdictions of practice for Josh. In the past two years, he has overseen defense verdicts in three trials which involved bad faith, fraud, and discrimination claims. In following with the L+K livelihood, Josh also has over seven years of workers’ compensation experience.

The Victory Lap

Kudos to Joseph W. Gren, who racked up two appellate victories for the firm in January. In front of the Industrial Claim Appeals Court, Joe successfully argued in Cheney v. Coca-Cola and Blue Bell Creameries that the Claimant’s injury was the result of his duties with Blue Bell and that Coca-Cola was not responsible for the requested elbow surgery. Cheney v. Coca-Cola Refreshments, Blue Bell Creameries, ACE American Insurance, and Standard Fire Insurance, W.C. No. 4-873-873, (January 29, 2013). In another L+K victory, the Colorado Court of Appeals affirmed an ICAO opinion denying reopening on the basis that the symptoms which Claimant asserted had worsened were not only unrelated, but may not have changed to an extent warranting reopening. Martinez v. ICAO and Evraz Rock Mountain Steel, (Colo. App. 2012)(nsfop).

Kudos also to Tiffany Scully Kinder, who recently had a successful outcome to litigation involving a Claimant’s claim for a worsening condition. Claimant had an undisputed head injury from being struck by a heavy machine gate, and attempted to add to the claim later treatment for a “traumatic brain injury.” Ms. Kinder successfully argued in Vu Bui v. Caraustar Industries, Inc. and ACE American Insurance, W.C. 4-893-645-02 (February 1, 2013) that this later claim for benefits was not related to the initial work-related injury. Claimant’s claim for further medical treatment was denied and dismissed.

Employer Guidelines for Workers’ Compensation Claims

N. Elizabeth Quick, Esq.

On November 6, 2012, Colorado became the first State to legalize marijuana with the passage of Amendment 64. Under Amendment 64, persons over the age of twenty-one will be allowed to legally possess up to one ounce of marijuana[1]. However, the Amendment contains a provision for employers, subsection six (6). This provision states, “Nothing in this section is intended to require an employer to permit or accommodate the use, consumption, possession, transfer, display, transportation, sale or growing of marijuana in the workplace or to affect the ability of employers to have policies restricting the use of marijuana by employees.”

Despite Colorado legislation, possession and growing of marijuana remains illegal under federal law, and is classified as a Schedule I Controlled Substance under the Federal Controlled Substances Act. Given the conflict between State and Federal Law, how do employers proceed? State laws which conflict with, or are contrary to, federal laws are invalid[2]. We anticipate substantial litigation regarding the constitutionality of Amendment 64, and the Department of Justice has pledged to challenge Amendment 64 in federal court. Given that Federal Law ultimately controls, we recommend all employers update, or implement, a “no tolerance” policy for drugs and alcohol.

While marijuana may be legal in Colorado, employers may still use consumption of marijuana as a basis for a safety rule violation or termination for cause in a workers’ compensation claim. The hallucinogenic agent in marijuana is THC, and can be detected at a level of 5ng/mL[3].  THC is stored in the body’s fat, making it possible to detect for up to 13 days[4]. However, only 20% of THC is detectible in a urine screen[5], as the THC has already passed through the body.  If an employer is randomly testing employees for drug use, we recommend urine screens as the standard protocol. The THC present in the drug screen will be sufficient to show use and support a termination for cause defense.

However, THC is also detectible in the blood, and blood tests will show the current levels of THC in the employee’s bloodstream; the level of THC intoxication (see footnote 5). While a toxicologist may testify regarding THC levels expected in a “recreational user” versus the THC levels present in a blood sample, there is currently no State recognized level of marijuana intoxication. Despite this oversight in regulation, we recommend employers require employees to submit to a blood test if an accident or safety rule violation has occurred. The practice of employer-required blood tests has repeatedly been upheld by the Courts[6].

To prove a safety rule violation, the employer and insurer must show the injury was caused by the employee’s marijuana use[7]. The blood sample will allow the toxicologist to testify regarding how the level of THC in the employee’s blood would have affected job performance at the time of the injury. Common signs of marijuana impairment include: distorted perceptions; impaired coordination; difficulty with thinking and problem solving; and problems with learning and memory[8].

In summary, despite the passage of Amendment 64, employers may continue to hold their employees accountable for marijuana use on the job through the safety rule violation and termination for cause provisions of the Workers’ Compensation Act. Please do not hesitate to contact our office so that we may provide additional guidance on this issue on a case by case basis.

The court held that counsel with a valid Power of Attorney has the power to stipulate to Average Weekly Wage. The court also held such a stipulation is not a settlement.

Claimant retained counsel after suffering an industrial injury. Claimant entered into a fee agreement that included a Power of Attorney provision which allowed the attorney to “act in the name and place of the claimant, and to perform every act necessary to be done for claimant.” The provision also included a clause prohibiting the attorney from settling the case without Claimant’s permission. Claimant’s attorney later stipulated to a figure for Claimant’s Average Weekly Wage. The case was closed

Claimant later sustained a worsening of condition and the case was reopened. With new counsel, Claimant argued that the prior stipulation was void because she alleged that her former attorney had no right to stipulate to her Average Weekly Wage. Claimant also asserted that the stipulation was void because it constituted a “settlement” prohibited in the fee agreement.

The court disagreed, holding that the clause allowing the attorney to act on Claimant’s behalf empowered the attorney to stipulate to Average Weekly Wage. The court also held that the stipulation did not violate the settlement-prohibition clause, because the stipulation was not a settlement within the meaning of the clause.

Rivera v. The Corcoran Company, W.C. No. 4-759-240

The court held that relying on the advice of the DIME unit in transmitting medical reports to a DIME physician does not constitute a violation of penalty Rule 11-6. The also court held that, for purposes of penalty Rule 11-7, a DIME physician’s request for a second opinion does not constitute additional treatment.

Claimant underwent a Division Independent Medical Examination after he sustained an admitted work-related injury. The DIME physician requested a second opinion regarding the necessity of a specific surgery before he could make any Maximum Medical Improvement (MMI) determination. The physician asserted that he would provide an addendum to his report after he received the surgical opinion. He also stated that if Claimant did not require surgery, he had reached MMI.

Claimant received a second surgical opinion, and the report was sent to the insurance adjuster, who had never dealt with a case involving a DIME addendum. Unsure how to transmit the report to the DIME physician, the adjuster contacted the DIME unit. The DIME unit told her to send the report directly to the physician as well as to the DIME unit and Claimant’s attorney. The adjuster complied.

Claimant objected and asserted penalties against Respondents for the adjuster’s alleged violation of Rule 11-7, which requires a follow-up IME if the original DIME physician recommends further treatment, and of Rule 11-6, which prohibits communication between the DIME physician and the parties unless approved by the Director or an ALJ.

The court concluded that Respondents had not violated either rule. The court held that the physician’s request for a second opinion did not constitute further treatment, so a follow-up IME was not required. The court also held that because there was no rule that applied to the specific circumstances, the adjuster acted objectively reasonably by contacting the DIME unit and sending the report according to their instructions.

Shickel v. Newflower Market, W.C. No. 4-824-963

Claimant sustained a compensable injury to his ankle in January 2009. The injury required orthopedic surgery and Claimant was later treated for an infection related to the surgery. After this treatment, Claimant showed no symptoms of the infection. On May 11, 2010, Claimant fell off a ladder and injured his ankle again. Two days later, Claimant was injured in a car accident while on his way to see the doctor for his ankle. Claimant suffered bruising from his seat belt. Claimant later checked into the emergency room, where an emergency surgery on his foot revealed significant infection. The infection had also spread to other parts of Claimant’s body.

Claimant asserted that he sustained two separate work-related injuries – on May 11 and on May 13 – and asserted that these injuries caused the reoccurrence of his infection. The court disagreed, finding that Claimant suffered only one injury – on May 11. In crediting one physician’s testimony, the court also found that Claimant’s infection was not caused by the injury, but instead had occurred independently, because Claimant was particularly susceptible to the infection.

Chavez and Pinnacol Assurance v. Kelley Trucking, Inc., 10CA1720

The Court held that claimants have no obligation to seek an insurer’s consent in order to settle with a third party for non-economic damages. The Court also held that claimants were not obligated to pursue all related causes of action jointly with their insurer.

Claimant sustained a work-related injury during a motor vehicle accident. Claimant and insurer, Pinnacol, jointly filed against the three tortfeasors who caused the accident. Claimant and Pinnacol settled with two of the defendants, and Claimant also settled Claimant’s workers’ compensation claim with Pinnacol. Claimant then independently settled with the third defendant, Kelley Trucking. The settlement stated that Claimant provided a release for all non-economic damages arising out of the accident. The settlement expressly stated that it did not “settle, release, reduce, compromise or affect” any causes of action subrogated to Pinnacol. Pinnacol proceeded to trial against Kelley, but was awarded no damages.

Pinnacol subsequently argued that Claimant must forfeit the settlement because Claimant did not seek written approval from Pinnacol pursuant to C.R.S. 8-41-203(2) before settling with Kelley. In the alternative, Pinnacol argued that the settlement should be allocated between Claimant and Pinnacol because Claimant was required to pursue all settlements jointly with Pinnacol.

The Court disagreed, holding that Pinnacol’s subrogation rights extended only to those damages for which Pinnacol was liable, namely “all compensation and all medical, hospital, dental, funeral, and other benefits and expenses to which the employee…[is] entitled under [the Act].” The Court noted that Pinnacol was not liable to Claimant for non-economic damages. Therefore, while Claimant could not settle with Kelley for expenses for which Pinnacol was liable, he could settle for those for which Pinnacol was not liable. The Court also noted that the settlement “explicitly and successfully preserved Pinnacol’s ability to prosecute the subrogated claims.” Therefore, the Court held that Claimant was not required to seek Pinnacol’s permission in order to pursue a settlement for non-economic damages. The Court also held that there is no provision or case that required Claimant and Pinnacol to obtain settlements jointly.

Loofbourrow v. Industrial Claim Appeals Office, W.C. No. 4-804-458; 10CA2176

The Court held that, when a claimant suffers a worsening of condition in a claim that remains open and for which no admission of liability has been filed, the claimant may still receive Temporary Total Disability (TTD) benefits after being placed at Maximum Medical Improvement (MMI). The Court also held that employers must specify an Authorized Treating Provider (ATP) for both the initial injury and also for the worsening of condition.

In November 2008, Claimant sustained a compensable back injury and was placed at MMI with no permanent medical impairment. Claimant received treatment, but lost no time at work. Because Respondents did not file any admission of liability, the case remained open. However, Claimant later sustained a worsening of condition which forced her to stop working. Claimant notified Respondents of the worsening, but Respondents failed to designate an ATP. Claimant began treating with her personal physician, to which Respondents objected.

The Court concluded that, although Respondents had designated an ATP for Claimant’s initial injury, they failed to direct Claimant back to her original ATP, so the right of selection had passed to Claimant.

Claimant alleged entitlement to TTD benefits. Ordinarily, a claimant is only eligible for TTD benefits up to the point that she is placed at MMI. An MMI determination is binding in the absence of a DIME. However, a claimant may only undergo a DIME after the employer or insurer files a Final Admission of Liability (FAL). Because Respondents never filed an FAL, Claimant never had the opportunity to contest the MMI determination. Without an FAL, the case remained open.

The Court first stated that the fact that a case remained open did not preclude a claimant from asserting a worsening of condition. The Court next asserted that, because Claimant could not challenge the MMI determination – and thus potentially be taken off MMI and eligible for TTD benefits – she was entitled to the TTD benefits she accrued because of her worsening of condition.

Risberg v. Industrial Claim Appeals Office, W.C. No. 3-941-887; 10CA2593

In an unpublished opinion, the Court held that an expert at hearing cannot base his testimony on assumptions that contradict facts established at prior hearing. The Court also held that the law at the time a claimant is initially determined to be permanently and totally disabled is the standard that governs whether a claimant’s condition has improved.

Claimant suffered a compensable brain injury in 1988. She was placed at MMI in 1992 and determined to be permanently and totally disabled. She began receiving Permanent Total Disability (PTD) benefits. In 2006, after Claimant’s credit and identity cards were stolen and Claimant began her own investigation of the matter, a local news station aired a segment profiling Claimant and her efforts. Prompted by the report and other surveillance, Respondents alleged Claimant had undergone a change in condition or had committed fraud, and sought to reopen the case and to terminate Claimant’s PTD benefits. An ALJ, relying on the testimony of three of Respondents’ expert witnesses, found that Claimant’s status had improved and that she was no longer permanently and totally disabled.

During the hearing, Respondents presented testimony from a neuropsychologist and psychiatrist, both of whom asserted that Claimant had never suffered a compensable brain injury. The Court stated that the testimony should not have been admitted, because, in stating that Claimant never sustained a compensable injury, the experts raised an original issue that had already been litigated in 1988. The Court concluded that the experts’ opinions did not have a reasonable basis and were legally unfounded because claimant’s injury had already been established in prior proceedings.

Respondents also presented the testimony of a vocational expert who both relied on the other two experts’ assertion that Claimant never suffered a compensable injury and also applied the current legal standard for permanent and total disability. The expert asserted Claimant did not meet the current standard that an employee be “unable to earn any wages in the same or other employment” to be considered permanently and totally disabled. However, the Court held that the applicable legal standard was the standard at the time that Claimant was initially determined to be permanently and totally disabled. The standard at that time only required that an employ be unable to regain efficiency in some substantial degree as a working unit in the fields of general employment. Because the expert applied an incorrect legal standard, the Court held that the expert’s testimony should not have been admitted.

The Court concluded that the ALJ should never have considered the experts’ testimony, because the Court found the testimony of all three experts legally unfounded. As a result, the Court overturned the ALJ’s ruling and denied Respondents’ request to reopen the case and terminate PTD benefits.

Beth Robinson v. Goodbye Blue Monday, W.C. No. 4-613-287 (April 21, 2011)

The parties entered into a full and final settlement agreement, which included funding of a Medicare Set Aside (MSA). The settlement agreement provided that Respondents would fund the MSA upon CMS approval. Another provision stated that MSA funding was contingent upon CMS approval and Respondents agreed to pay for maintenance medical benefits during the approval process.

After the settlement agreement, the Social Security Administration awarded the Claimant retroactive Social Security Disability Income (SSDI) benefits. Respondents refused to submit the MSA for CMS approval. Respondents also refused to pay maintenance medical benefits pending approval of the MSA. Respondents argued that submission of the MSA to CMS was futile because the amount of the settlement was under $250,000 and CMS would not likely consider the MSA proposal.

The ALJ determined that Respondents’ conduct caused the Claimant “great harm and potential harm.” The ALJ assessed penalties in the amount of $300 per day from November 23, 2009 through July 29, 2010 for Respondents’ failure to pay maintenance medical benefits, which the ALJ construed as unilateral termination of medical benefits despite the amendments to W.C.R.P. Rule 7-2. The I.C.A.O. affirmed the ALJ’s assessment of monetary penalties against Respondents.

Deanna Siefken v. The Home Depot, W.C. No. 4-740-549 (April 27, 2011)

The I.C.A.O. issued two separate opinions on April 27, 2011 in favor of Respondents. One case concerned insurance coverage and penalties. The second case concerned permanent partial disability benefits and medical maintenance benefits.

In the first case, Claimant sought monetary penalties for the employer’s alleged failure to carry worker’s compensation insurance. Claimant argued the employer’s contractual obligation to reimburse the insurer was considered a “deductable.” The Colorado Workers’ Compensation Act prohibits deductibles from exceeding $5,000.  The ALJ determined that the contractual obligation was not a deductable because a deductable is defined as “the portion of the loss to be borne by the insured before the insurer becomes liable for payment.” Thus, Respondents did not violate the Act’s insurance coverage requirements. The I.C.A.O. affirmed.

In the second case, the insurer, but not Respondents’ attorney or the employer received a DIME report.  Respondents did not receive the DIME addendum report until several months later. Respondents subsequently filed an Application for Hearing to overcome the DIME on the issue of MMI and impairment. The DIME provided a 23% whole person impairment rating, which the ALJ overruled and provided no impairment.  The Claimant argued that Respondents failed to timely file an Application for Hearing challenging the DIME physician’s opinion on MMI and impairment. The ALJ determined Respondents’ receipt of the DIME addendum report triggered the statutory 30 day time limit to file an Application for Hearing to challenge the DIME physician’s opinion. The I.C.A.O. affirmed.

Ben Steele v. Oakland Raiders, W.C. No. 4-833-191 (April 27, 2011)

Claimant, who resided Colorado and played football in California, filed a claim for workers’ compensation benefits in California. Respondents filed the Employer’s First Report of Injury in Colorado. The Director assessed monetary penalties against Respondents failure to file a position within 20 days. Respondents submitted documents to the Director evidencing that Claimant sought benefits in California for alleged cumulative trauma. While the I.C.A.O. vacated the Director’s penalties order, the case was remanded to determine whether it was necessary for Respondents to admit or deny the claim given that the First Report of Injury was filed in Colorado.

Schell v. Tolin Mechanical Systems, W.C. No. 4-592-624 (May 11, 2011)

Respondents sought to introduce testimony of an employer witness at hearing. The ALJ barred the witness’s testimony on the grounds that Respondents failed to endorse the witness on their Response to Application for Hearing. A co-Respondent removed from the claim prior to hearing endorsed the witness on their Response to Application for Hearing. The I.C.A.O. affirmed the ALJ’s decision holding that only witnesses endorsed on the pleadings may testify not withstanding a later order or written agreement.

Medina-Weber v. Denver Public Schools, W.C. No. 4-782-625 (May 9, 2011)

During a previous claim, Respondents overcame a DIME that assessed a 13% whole person impairment rating. The DIME also apportioned 10% of the 13% whole person impairment rating to previous injuries. At hearing, the ALJ assessed no permanent impairment. During a later case, the Claimant underwent a DIME, which determined physical impairment with no apportionment. The later ALJ determined that no apportionment was applicable because the previous ALJ provided no ratable impairment.

On appeal, the I.C.A.O. stated that the DIME report must be overcome by clear and convincing evidence. Although the first ALJ determined permanent impairment, the Claimant did not overcome the first DIME physician’s apportionment determination by clear and convincing evidence. Thus, the I.C.A.O. held that apportionment was applicable and remanded the case for an apportionment determination.

Munoz v. Industrial Claim Appeals Office, No. 10CA0592 (May 12, 2011)

This case involved whether DIME proceedings are stayed during the pendency of a dispute over the DIME selection process. The Court of Appeals held that when an Application for Hearing challenging the DIME selection process is filed with the Office of Administrative Courts and the party serves the Division DIME Unit, the stay of DIME proceedings is automatic. The Court of Appeals dismissed the remaining penalties issue.

This claim addresses the “similar” insurance coverage requirements of C.R.S. § 40-11.5102(5)(b). Claimant was injured while operating a taxi cab.  Metro asserted that Claimant was an independent contractor.  The ALJ held that Claimant was an employee of Metro Taxi based on the terms of the agreement between Claimant and Metro.  Additionally, Metro was uninsured at the time, and notified of such due to another pending claim.  The ALJ assessed penalties against Metro for violation of C.R.S. § 40-11.5102(5)(b) as Claimant’s insurance policy with AIG was “not similar” to workers’ compensative coverage. The panel affirmed. What this means for you: An employer cannot evade the required workers’ compensation coverage by contracting out work to independent contractors with substandard coverage plans. Ensure all independent contractors or contract employees have sufficient coverage similar to workers’ compensation coverage.

Lane v. Hospital Shared Services, W.C. No. 4-784-015, ICAO

This claim addresses the causation requirement between inability to earn wages and eligibility for permanent total disability (PTD) benefits. Claimant injured his left arm and hand tripping over a pallet jack.  In addition to his workers’ compensation injury, Claimant suffered from numerous, debilitating non-work related conditions. With all of his injuries and illnesses, Claimant was unable to work and asserted a claim for PTD benefits.  The ALJ determined Claimant’s inability to earn wages was due to his non-work related conditions and complications, and he was therefore not eligible for PTD benefits. The panel affirmed.  What this means for you: Claimant bears the burden to prove that the industrial injury is a “significant causative factor” in Claimant’s inability to earn wages and subsequent entitlement to PTD benefits.

Trusty v. Big Lots Stores, Inc., W.C. No. 4-770-446, ICAO

This claim addresses the requirement to assert the affirmative defense of issue preclusion (a.k.a. collateral estoppel). Claimant suffered a low back injury which was found compensable by ALJ Felter. Claimant underwent a Division IME (DIME) and was provided a 20% whole person impairment rating. Respondents challenged the DIME, and ALJ Jones found Respondents overcame the DIME by clear and convincing evidence. Claimant appealed on the basis that compensability was determined by ALJ Felter, and thus precluded from consideration by ALJ Jones. The panel referenced Sunny Acres Villa, Inc. and held that the issue sought to be precluded must be identical to an issue actually determined in prior proceedings. Because Claimant did not raise the issue of impairment or the issue of the nature and extent of his permanent impairment before ALJ Felter, ALJ Jones properly considered the issue at hearing and did not commit error in determining Respondents met their burden to overcome the DIME by clear and convincing evidence. What this means for you: Collateral estoppel will rarely be an available affirmative defense, as issues raised in subsequent hearings are rarely similar, let alone identical, to issues raised in initial compensability proceedings.

Pankratz v. Hancock Fabrics, W.C. No. 4-653-869, ICAO

This claim addresses the rights of the parties to alter a settlement agreement in the event the Medicare Set Aside (MSA) approved amount far exceeds the estimated amount. The parties entered into an approved settlement agreement with Respondents’ agreement to fund an MSA which was estimated to be approximately $30,000. The final approved MSA amount was over $488,000. Respondents filed an Application for Hearing and requested the MSA portion of the settlement be set aside to due mutual mistake of material fact. Claimant then alleged penalties against Respondents for failure to comply with the Order approving the settlement. The ALJ found Respondents failed to prove mutual mistake and denied Claimant’s claim for penalties Claimant appealed the ALJ’s failure to impose penalties, and asserted the ALJ erred in determining he had no jurisdiction over the MSA. The panel held that W.C.R.P. Rule 7-2(A)(1) clearly stated that approval of a settlement agreement does not constitute approval of an MSA, and therefore Respondents were not in violation of the Order, or subject to penalties, by failing to adequately fund the MSA. What this means for you: The panel intimated the MSA might well be a binding agreement, a breach of which could lead to a cause of action. However, the panel did not reach any further conclusions as that issue was not before the panel. Structure settlement language carefully to allow for setting aside the settlement agreement in the case of a “surprise” MSA amount.

Smith v. J-T Initiatives, Inc., W.C. No. 4-815-801, ICAO

This claim affirms established law that a Claimant is entitled to an increase in average weekly wage based on concurrent employment, which will correspondingly increase Claimant’s temporary total disability benefit rate.

Olaes v. Elkhorn Construction Company, W.C. No. 4-782-977, ICAO

This claim affirms established law that a Claimant who is responsible for termination of their employment cannot allege entitlement to lost wages through temporary total disability benefits.  In this claim, Claimant falsified his social security and permanent resident card.

Steele v. Denver Public Schools, W.C. Nos. 4-826-116 & 4-833-702, ICAO

This claim affirms established law that a Claimant must prove compensability by a preponderance of the evidence, and an ALJ’s determination regarding compensability will not be disturbed on appeal unless the findings of fact are not supported by the evidence.

Johnson v. Champ, LLC, W.C. No. 4-785-983, ICAO

This claim concerns the required supporting documentation for proper filing of a Final Admission of Liability (FAL). At hearing, the ALJ concluded the physician’s report attached to the FAL had been altered, most likely by outside influence, in regards to permanent impairment and MMI. Respondents had admitted for a wrist injury, which was at MMI, but not Claimant’s neck, elbow, and shoulder conditions. As such, the ALJ held the FAL to be void, and assessed penalties against Respondents in the amount of $49,050 for violation of W.C.R.P. 5-5.  Respondents appealed, citing violation of due process, and improper burden shifting on causation. The panel held Respondents were not provided sufficient notice regarding the allegedly altered FAL, thus the ALJ abused his discretion by not providing the insurer with a fair opportunity to respond to the allegation. Regarding causation, the panel found the ALJ had not made sufficient findings of fact to conclude that Respondents knew the disputed conditions were related to the admitted condition upon the filing of the FAL, and therefore could not assess penalties.  The panel remanded the claim back to the ALJ for further findings.  What this means for you: Whenever a Claimant asserts a claim for penalties, request that the ALJ make in-depth, specific findings of fact for the basis of penalties so that your counsel can properly consider appeal without remand.

A new section was added as C.R.S. § 8-43-317.  This section requires that all documents exchanged under the Act must be served in the same manner or means to all recipients.

C.R.S. § 8-43-404 was amended to clarify that the rule regarding independent medical examination (IME) recordings of employer-sponsored IMEs applies to all workers’ compensation claims, regardless of the date the claim was filed.

This means all respondent-sponsored IMES must be electronically recorded, regardless of the date of claim.

Further, W.C.P.R. Rule 8-1(D) clarifies the disclosure process as well as the responsibility for payment of an IME recording.  This Rule mandates that no matter who is the requesting party of an IME recording, the first copy of the recording should be provided only to the injured worker.  It goes on to delineate responsibility of payment for the IME recording, in that the party making the initial request is responsible for the cost of the recording.  If respondents make the initial request, they shall pay for the claimant’s copy.  This Rule further gives the right of pre-payment to physicians prior to release of a recording.

With regard to Division IMEs, SB 10-011 amended C.R.S. § 8-42-107.2(3.5) so that any party may request the Division IME physician disclose any business, financial, and/or employment relationship information he/she may have with the authorized treating physician (ATP) in a claim prior to that party striking the Division IME physician from the proposed panel.  After receipt of the summary disclosure statement, it also ensures that a strike is not necessary until after a “reasonable” time for the requesting party to review the disclosure materials.

HB 10-1038 amended a section under C.R.S. § 8-43-203.  The Statute now requires an employer or insurance carrier to provide the claimant with a brochure written in easily understood language which describes the claims process and informs the claimant of his/her rights.  (This brochure has been drafted by the Division of Workers’ Compensation and may be downloaded and printed.)

HB 10-1076 amended C.R.S. §§ 8-40-203(3), 8-40-301(9) and 8-41-210, and expanded the definition of “employee” to include elderly or disabled persons working under the “Property Tax Work-Off Program” (pursuant to Article 3.7 of Title 39, C.R.S.), for purposes of workers’ compensation.  Workers’ compensation insurance may be purchased for the express purpose of covering these individuals.

HB 10-1108 amended C.R.S. § 8-40-202(2)(d)(I), which now excludes sports coaches claiming independent contractor status from the definition of “employee” for purposes of workers’ compensation coverage.  The legislation is specific to non-profit youth sports organizations and requires a written agreement between the coach and the organization specifying that the coach is an independent contractor and the nonprofit “is not obligated to secure compensation for the coach.”  It sets forth the requirements of the written agreement between the parties.

SB 10-013 added an additional section to C.R.S. § 8-43-220, which required the claimant to complete an exit survey furnished by the insurers after a claim is closed.  This survey is conducted to examine the claimant’s satisfaction with the workers’ compensation experience.  In addition, the Statute states that employers may not take any disciplinary action for the employee’s responses to this survey, and that insurers will report the results of the survey for posting on the Division’s web site.

SB 10-178 is known as the Provider Review and Disclosure Act.  The new sections under C.R.S. § 8-43-601 – 607 declare that “all performance programs must be fair, objective, consistently applied and accord [authorized health care] providers due process.”  Further, any such employer performance program should authorize “effective, high quality care.”

SB 10-187 features amendments or additions to the existing statutes.  Under C.R.S. § 8-40-201(19)(b), indigent health care programs such as Medicaid are now excluded from wage calculations.  It appears that they may not substitute for the value of employer purchased health insurance in calculating average weekly wage (AWW).  C.R.S. § 8-42-101(5) is added to provide the injured worker payment for “reasonable costs” to pursue medical maintenance recommended by the authorized physician if the insurer later admits to liability less than twenty days before a hearing, or is ordered to do so after the hearing, or is ordered to do so after the application has been filed.  C.R.S. § 8-42-102(5)(a) now clarifies the phrase “at the time of injury” to mean the AWW on the date that the injury occurred.

C.R.S. §§ 8-42-103(1)(c)(I), (II) and (1)(d)(I) now eliminate offsets for permanent partial disability (PPD) benefits when a claimant receives Social Security Disability Income (SSDI).  In addition, it repeals the requirement that injured workers apply for SSDI benefits when the employer requests this or seeks the status of the application.  This Section also eliminates the mandate that failure to comply with applying or reporting will be cause to suspend benefits.

C.R.S. §§ 8-42-105(4)(a), (b) and (c) would now allow that in cases where the employee declines modified employment, the employee may reject the job if (a) the offer requires an additional commute of 50 miles one way, or (b) if the judge determines the refusal is reasonable by virtue of financial hardship or other impracticalities.

Under C.R.S. § 8-42-107.5, the combined temporary partial disability (TPD) and PPD caps on liability beginning July 1, 2011 and every July after that, will be annually adjusted by reference to changes to the state’s AWW.  This now applies to all injuries sustained after January 1, 2012.

C.R.S. § 8-42-406(2)(b) is amended to prohibit the Director or an Administrative Law Judge (ALJ) from conditioning a lump sum payment on the claimant waiving his or her right to pursue permanent total disability (PTD) benefits.

As of August 11, 2010, SB 10-012 amended C.R.S. § 8-43-304(1) to increase the penalty for failure to act in accordance with prescribed duties or time constraints of the workers’ compensation laws.  A fine of up to $1,000 per day may be imposed for each offense.  This Amendment also mandates that a minimum of 50% must be allocated to the “aggrieved party.”  In addition, C.R.S. § 8-43-401(2)(a) states that after appeals or final admissions, or when no more appeals exist, benefits are paid within thirty days after benefits are due.  If these benefits are KNOWINGLY delayed or the insurer KNOWINGLY stops payments for more than thirty days, the insurer will pay a penalty of 8% of the amount of the benefit.  If PPD payments are withheld for more than 30 days, the penalty is 10%.  However, this Bill also states that no penalty is due if the delay is proven to be the result of excusable neglect.

C.R.S. § 8-42-113.5(b.5)(II) is amended to require an overpayment be recovered within one year after knowledge of the overpayment following the filing of a FAL, except in cases of fraud.  This applies to all overpayments, regardless of the date of injury.  This amendment therefore necessitates respondents to get a court order, or at least file an application for hearing, on the issue even if there is existing negotiation with a claimant.  Otherwise, the right to do so may be waived.

Finally, the following are changes made to issues with regard to settlement.

C.R.S. § 8-43-204 was amended to mandate that settlements must be paid fifteen days after receipt of the executed settlement order.  Specifically, “any lump sum payable as a full or partial settlement shall be paid to the claimant or the claimant’s attorney within fifteen calendar days after the date the executed settlement order is received by the carrier or the noninsured or self-insured.”

An amendment to C.R.S. § 8-44-116(5)(c) denies reversionary interest, i.e. annuities, for indemnity benefits permitted in general settlement.

W.C.R.P. Rule 7-4 was amended to increase life expectancy calculations to aid in the settlement process.

Tried by Mr. Thomas Kanan, Lee and Kinder, LLC recently litigated an appeal in the Colorado Supreme Court concerning whether an average weekly wage can be recalculated beyond the statutory limit on maximum benefits, and won a determination that the maximum cap remains applicable for all cases after their original “date of injury.” This issue had arisen in a case decided by the Supreme Court itself in late 2008, in which the Court held that a claim can have multiple dates of injury or “disablements” that entitle claimants to recalculations of their average weekly wages. So, claimants began asking for new higher payment of benefits after any “worsening” of their conditions, based upon higher maximum rate entitlements linked to the subsequent dates of injury. It is very rare for this Court to reverse itself as quickly as we were able to achieve here. The Court’s own summary of the case is presented below. The special concurrence of Justice Coates is worth reading for a sense of what has been in dispute in the Supreme Court concerning average weekly wage determinations. With the announced retirement of Chief Justice Mullarkey, who authored the 2008 case that was partially reversed, the new justice appointed to the Court by Governor Ritter will have the power to decide this issue in the future because the original decision was by one vote alone (4/3) .
http://www.cobar.org/opinions/opinion.cfm?opinionid=7646&courtid=2

Workers’ Compensation—Maximum Rate of Benefits.
The Supreme Court consolidated two court of appeals opinions that address statutory limits on workers’ compensation benefits. The Court concluded that a workers’ compensation claimant is entitled to the maximum rate of benefits in effect at the time of injury. In a 2008 case, Avalanche Industries, Inc. v. Clark, 198 P.3d 589, 597‐98 (Colo. 2008) (section III.C.), the Court held that “time of injury” could mean either the time of accident or the time of disablement.
In each of the cases here, the court of appeals relied on section III.C. of Avalanche Industries to hold that the claimant was entitled to have his benefits calculated based on the maximum rate in effect at the claimant’s time of disablement. The Court held that section III.C. of Avalanche Industries was unnecessary to decide that case, and overruled the holding that the claimant’s “time of injury” could mean either time of accident or time of disablement. Because the court of appeals’ opinions relied on section III.C. of Avalanche Industries in these cases, the Court reversed those decisions.